Overcoming barriers to better SME energy use

In 2023, Energy Consumers Australia (ECA) commissioned research into how small businesses engage with the energy sector. This relates to issues including decarbonising, engaging in and benefiting from government energy policies The research also covered how those who support SMEs advocate for small business in the policy space, and this includes advisers such as accountants, but also importantly, associations. 

Barriers for all small businesses

From the research, four main barriers emerged that all small businesses share:

      • Choice: Small businesses have less control over their energy choices than many households

      • Cost: The cost of doing business is tightening business profits

      • Time: Small businesses face time constraints when making significant changes

      • Access to information: There is a lack of suitable information for small businesses

    The report, Power over their Power – Small business perspectives on energy, found three main actions that would support small businesses better manage their energy:

      1. Businesses need the right information, at the right time, from trusted sources. Governments should develop clear advice and tailored, relatable communications that take account of the diversity within the small business community and are delivered through trusted pathways.

      2. Regulatory frameworks should consider the diversity of small businesses. Governments should develop fit for purpose regulation working with small business representative bodies, particularly in the areas of Environmental, Social and Governance (ESG) matters, embedded networks, and commercial leasing regulations.

      3. Governments should provide appropriate options of practical financial assistance for small businesses to transition their energy use which considers the different needs of the small business sector.

      Clues in further research

      ECA’s October 2023 Behaviour survey includes this result for SMEs. It shows a clear interest in switching from gas to electricity, which is an important method of reducing carbon emissions:

      ClimateWise Associations’ program to overcome these barriers

      ClimateWise Associations has recognised the barriers to SME decarbonisation and advocates using associations as the conduit to change. All three of the above actions can be managed through associations that represent SMEs.

      Association members are best served through associations, because they understand their particular sector and represent their interests. ECA’s complementary research on SME communications reinforces associations’ role as trusted sources of information and guidance.

      The ClimateWise Associations’ program is designed specifically to promote leadership by associations for members. And ClimateWise Associations’ proposal for government grants to be made to associations would be a cost-effective way to expedite action across sectors.

      Read our proposal for more detail and help advocate for this valuable initiative.

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